The pound grew against US dollar during Monday trading, partially compensating corrective reduction that took place at the end of the previous week. Along with that the instrument failed to consolidate around previous local maximums, and by the moment of closing of the daily session it lost the majority of gained positions.
The catalyst for the growth of the pound was positive news and gossip about the progress of Brexit negotiations. The UK Prime Minister Theresa May stated yesterday that the parties had managed to reach consensus on a number of topics, in particular Ireland. Still, some issues remain, and the UK is in a hurry to resolve them before the EU summit that is scheduled for December 14.
Today investors will focus their attention on Eurozone and US PMI statistics. The data from the UK are due at 11:30 (GMT+2). According to the analysts, the indicator may reduce from 55.6 to 55.0 points. US statistics will be released at 16:45 and 17:00 (GMT+2).
Support and resistance
Bollinger Bands in D1 chart show stable growth. The price range is slightly narrowing. MACD indicator is trying to reverse downwards preserving a buy signal (the histogram is above the signal line). Stochastic is showing similar dynamics.
Resistance levels: 1.3500, 1.3548, 1.3617.
Support levels: 1.3454, 1.3411, 1.3381, 1.3336, 1.3278.
Long positions may be opened after breaking out the level of 1.3500 with targets at 1.3600, 1.3617 and stop-loss at 1.3450. The period of implementation is 2-3 days.
Breaking down the levels of 1.3454 or 1.3411 may be a signal for the beginning of sales with targets at 1.3336, 1.3300 and stop-loss at 1.3500. The period of implementation is 2-3 days.